Last week, ICON announced a major change to IISS (ICON Incentive Scoring System), and provided details about the upcoming P-Rep pre-voting period. In this post, we’ll discuss the changes to IISS, as well as what kind of ICX rewards ICONists can expect to see during the pre-voting period in August.
ICON’s initial IISS model relied on P-Reps setting ICX reward rates. Over time, the ICON team realized this model could potentially give too much power to the P-Reps in terms of the network’s monetary policy. As a result, ICON has updated the IISS model to automatically calculate ICX rewards based on the percentage of network staked. The team has also added an un-staking variable, which is also calculated from the percentage of network staked.
An Update to IISS
Here is a quick rundown of the IISS update.
- The reward rate per category (DApp, EEP, P-Rep) will range from 2% (100% network staked) to 12.5% (0% network staked).
- From 70-100% of network staked, the reward curve will yield a constant 2% reward rate per category.
- The unstaking period will range from 5 days (100% network staked) to 20 days (0% network staked).
Here are two graphs showing the reward rate and unstaking period curves.
P-Rep Pre-Voting Period
Starting in August, ICONists will be able to participate in a month-long pre-voting period to get used to the voting process before the official P-Rep election takes place in September. To incentivize ICONists to participate in this pre-voting event, ICON has set aside a pool of 3 million ICX to reward voters.
According to ICON, “based on a 30% delegation rate assumption, the average ICONist can expect a 15.81% (5.27% * 3) annualized reward during the pre-voting period.” This statement has caused some confusion in the ICON community over the past week, so let’s break down what it actually means.
- ICONists will NOT receive a 15.81% reward during the month of August. The 15.81% figure is annualized, which means the monthly reward rate is closer to 1.32% (15.81/12). Thus, a 10,000 ICX delegation will yield a ~132 ICX in August if 30% of the network is staked.
- The 15.81% figure is not a special promotional reward rate. If you look at the reward chart above, a 30% network stake yields a 5.27% reward rate per category (5.27 x 3 = 15.81). The actual rate in August will depend on how much ICX is staked.
- Once the ICON network is fully operational after the P-Rep election, staking rewards for ICONists will be sourced from block rewards. Since there are no block rewards yet, the reward pool for this promotion is coming from ICON’s ICX holdings.
Hopefully this post clarified some of the details behind the updated IISS model and pre-voting period reward structure. With two and a half months left to go before the pre-voting period, 2019 is shaping up to be a very exciting year for the ICON community.